AMD Shares Drop 3% as Oil Surges 9.6% and Meta Builds In-House AI Chips
Advanced Micro Devices slid nearly 3% Thursday after Brent crude jumped 9% and U.S. oil surged 9.6% as tensions escalated in the Middle East, dragging chipmakers down. Meanwhile, Meta’s plan to deploy four generations of in-house AI processors by 2027 could reduce AMD’s AI hardware sales.
1. Oil Prices Spike Due to Middle East Tensions
Brent crude futures jumped roughly 9% while U.S. crude climbed about 9.6% as geopolitical frictions intensified near the Strait of Hormuz. Elevated energy costs raised concerns over production expenses and supply chain disruptions across tech sectors.
2. AMD Shares Slide Nearly 3%
Advanced Micro Devices stock fell almost 3% on the back of the oil price rally, underperforming broader tech benchmarks. Investors reacted to the potential for higher operating costs and margin pressure at major chip producers.
3. Meta’s In-House AI Chips Pose Competitive Threat
Meta Platforms plans four generations of custom AI processors—MTIA 300 through MTIA 500—by 2027, with MTIA 300 already in production. The shift toward proprietary AI hardware may reduce future sales opportunities for external suppliers like AMD.